Obama Calls for Tax Code Overhaul

President Barack Obama gestures during a news conference in the White House briefing room in Washington, Tuesday, Dec. 7, 2010.
AP Photo/Susan Walsh

In a press conference Tuesday afternoon, President Obama said he hoped the two year-extension of upper-class tax cuts could be used as a window of opportunity to push for a major overhaul of the U.S. tax code, noting that "I don't think anybody thinks the tax code right now is fair or efficient."

"Part of what I want to do is to essentially get the American people in a safe place so that we can then get the economy in a stable place," said Mr. Obama in his remarks, which largely addressed the "framework" the White House worked out with Republicansthat would extend tax Bush-era cuts even for America's highest earners. "But we've got to have a larger debate about how is this - how is this country going to win the economic competition of the 21st century? How are we going to make sure we've got the best trained workers in the world?"

Mr. Obama emphasized that those initiatives needed to make America more globally competitive - like revamping the educational system, increasing support for research and development, and improving the nation's transportation infrastructure - would come with a hefty price tag.

"How are we going to pay for all that at a time when we've got both short-term deficit problems, medium-term deficit problems and long-term deficit problems?" Mr. Obama asked.

"That's going to mean, you know, looking at the tax code and saying, you know, 'What's fair? What's efficient?' And I don't think anybody thinks the tax code right now is fair or efficient," Mr. Obama continued. "But we've got to make sure that we don't just paper over those problems by borrowing from China or Saudi Arabia. And so that's going to be a major conversation."

The president added that he thought the GOP would have a tough time opposing such measures.

"In that context, I don't see how the Republicans win that argument," Mr. Obama said. "I don't know how they are going to be able to argue that extending permanently these high-end tax cuts is going to be good for our economy, when, to offset them, we'd end up having to cut vital services for our kids, for our veterans, for our seniors."

The president emphasized several times throughout the press conference that he did not equate compromise with defeat and promised he was open to hearing Republicans' thoughts on the matter.

"I'm happy to listen to their arguments," he said. "And, you know, I think the American people will benefit from that debate. And that's going to be starting next year."

Lucy Madison is a political reporter for CBSNews.com. You can read more of her posts here. Follow Hotsheet on Facebook and Twitter.